Purchasing real estate in Turkey, particularly in Istanbul, has become a source of concern for millions of foreign investors around the world, especially after that the Turkish government released a law granting Turkish citizenship to anyone who purchases real estate worth – at least $ 250.000 – and keeps it for three years at least.
We realized – in Prestij Consulting – from the hundreds of clients we communicate with every month that many of them are new to the Turkish real estate industry, and as a result, their time plan for buying a property in Turkey is unclear because they don’t know how long it would take them to find the appropriate property and complete the buying process.
For example, A customer would like to obtain Turkish citizenship by real estate investment, but he is well aware that the amount required to obtain the Turkish citizenship would not be available to him for at least six months to a year, so he begins now to solicit offers for current real estate prices that would almost certainly not be available after that time. By then, the prices will have dramatically increased.
On the other hand, some clients are willing to make a buying decision right now but provide misleading information to real estate marketing companies about when they want to make that decision. For example, a client could say: “I don’t want to buy real estate right now, I want an overview of the market”. For that purpose, our consulting team would introduce him to the real estate market in terms of areas and fundamentals, leaving the issue of real estate prices and real offers before the customer is fully prepared. We then would discover that the customer was paid with a fake offer by an inexperienced real estate consultant from another company to make the purchase.
Today, to prevent scenarios such as the above, we will define the steps required to purchase a property in Turkey, and we will include a timetable for each move:
1. Prepare answers to the following basic questions:
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- Is the property being purchased for residential or investment purposes?
- Is it an apartment or a villa if it’s for housing? Is it a house under renovation, a furnished apartment for touristic leasing, or a business store if it’s for investment?
- Is obtaining Turkish citizenship a goal or not? Since certain properties are not eligible for Turkish citizenship, and if the purpose for buying the property is to seek Turkish citizenship, the budget needed to purchase a property or collection of properties must not be less than $ 250.000, according to the Turkish government legislation. (Any claims to gain Turkish citizenship for less than $ 250.000 are false promises because the law’s script is clear and transparent, and any deception would subject you to legal responsibility, not the real estate broker who recommended you to purchase a property for less than this price and said it was appropriate for Turkish citizenship)
- When do you think you’ll be able to buy?
Keep in mind that if you wish to earn Turkish citizenship by purchasing real estate, the funds must be transferred via bank transfer from within or outside Turkey, and cash payments are not allowed, but nothing is stopping you from depositing your money cash in a bank account, before making the wire transfer (according to the Turkish government law regarding the law of granting Turkish citizenship to foreign investors)
If you live in a country that prohibits direct foreign transactions, you’ll need to find a way to get your money to Turkey and open a bank account to make the payment via bank transfer.
In terms of timeliness, deciding the answers to these questions takes just a few days, and if you can’t decide if you want to purchase a home or an investment property, don’t worry. Our qualified advisory team’s job is to give you a thorough overview of the Turkish real estate industry.
2. Choosing the right real estate broker, paying attention to the following points:
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- Choose a professional real estate marketing company with a website rich in real projects and a live blog that discusses topics of interest to those looking to buy real estate, and not only because its sole goal is to market and sell the most number of clients without carefully attending to each client’s request, but also because you can get to know the professional real estate company by the speed with which it responds to each client’s request.
- Remember that communicating with a large number of real estate brokers can have a negative impact on you, and you will be unable to distinguish between the advisor who cares for your interests and the misleader who only cares about his own. We – at Prestij Consulting – deal with over 350 real estate projects in Istanbul alone, and therefore if your request is either residential or commercial, we will help you. We will be with you until you achieve your goals.
3. The right start:
Istanbul is a large city that straddles the continents of Europe and Asia, separated by the Bosphorus Strait, and it is a city that is still expanding, with high-priced real estate near the Bosphorus, and low-priced in the city’s outskirts and the middle. So before you judge any offer you get, whether, for housing or investment, you must first understand the following:
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- If you aim to make a profit, you’ll need to know how to invest in real estate in Istanbul. We’ve discovered that many buyers compare real estate investment in Istanbul to real estate investment in their home countries, and therefore choose to buy inexpensive ready-made properties in the city’s surroundings to rent them out to make a profit. This investment may be profitable in their countries, but it is not the best investment plan in Istanbul, since the value of the rental return is far more dependent on the location of the property and the facilities surrounding it than on the size of the property itself. A small property of 70 square meters in the city center near a transportation station, for example, has a higher rental yield than a very large property of 400 square meters in Istanbul’s outskirts, and both properties are about the same amount.
In addition, the average annual rental yield in Istanbul’s city center is 4-5%, implying that each property will take about 20 years to pay off its initial investment. Although the investment return on a project under construction will hit 35% within one year of the overall property price, if the property takes two years to complete, you will earn 60% to 70% of the value of your capital, compared to just 10% of the rental return on a completed property.
The process of reselling real estate later is a crucial element of real estate investment in Istanbul, and it is here that the value of selecting the right location comes into play, as it encourages selling the property later and achieving additional income. Buying cheap properties outside of Istanbul’s center, on the other hand, will not only yield low rental returns but will also lose a significant portion of their original value when put on the market, particularly given the Turkish lira’s high inflation rates against foreign currencies.
Such facts can seem to be complicated and confusing, but our consultancy team will work with you to simplify these ideas and include actual examples with statistics so that you get the right property for your needs.
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- If your request is for a residential property, you must ensure that the property’s location is suitable for you and your family in terms of nearby services, educational centers, important facilities, and transportation; as it has to be a suitable area for you now and in the future, so you won’t have to change it every few years when the area is no longer suitable. The most crucial thing is to find an area that fits your culture and desires. Istanbul is unique. It offers a wide range of choices to fit everyone’s tastes.
The duration of this stage depends on the size of the investment you want to make and the amount of time you have to find a residential property that meets your needs. But in any case, our advisory team will familiarize you with all you need to know about real estate ownership, whether for living or investment, and answer all of your questions within 10 days.
4. Choose the right property:
After getting a good start and learning about the different areas of Istanbul and how to invest in real estate, as well as the rules that apply to foreigners who choose to buy real estate, now you’re ready to pick the right property for you. Keep the following in mind:
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- The experienced real estate agent who presented you with all of the above information is capable of locating the best price bid for the property that you want.
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- Professional companies are distinguished by their services both before and after the purchase transaction, so always remember to begin your real estate tour with the most professional firm, and if what was offered on the ground does not suit you, you can move on to the next agency. It is unfortunately not uncommon that some clients, once they arrive in Istanbul, they were seduced by new companies in the market who claimed to have better and cheaper offers, but when they went on real estate tours, they were deceived and sold properties that were not suitable for their needs, as there was also a lack of after-sales services. To avoid this and ensure that you get the right property, we recommend that you make your first tour with the best real estate advisor.
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- If you lay the proper foundation for ownership and investment in Istanbul, you will be able to choose the right property on your own, and our sales consultant’s job will be to introduce you to projects that meet your needs and negotiate the best price and payment process for you.
The duration of this phase is determined by the customer’s behavior and the degree to which they have completed the previously mentioned measures. We discovered that after contacting our advisory team and supplying all relevant details, many clients choose the right property for them on the field, and the majority of clients choose the right property for them in less than a week.
To conclude, the process of learning about the Turkish real estate market is relying on the customer’s activity. The timeline for this whole procedure would be between 7 and 30 days if the tips and points we presented above are implemented. According to our experience, customers who are looking for real estate offers for more than three months (even though they are ready to own real estate right now) are wasting their time because the real estate market in Istanbul is a dynamic and rapidly developing market, and the opportunities that exist today will most probably not remain after a week, in terms of availability and price. As a result, we frequently counsel customers with full knowledge to complete the ownership process today rather than tomorrow.
